Scalping index options: experience, tips, resources

  1. Retailers who prefer scalping index options as their main trading method, what’s your experiences and some observation?
  2. Limit/Market/SL order - which order type do you use to enter a trade? As a scalper, if you use a Market order to buy an option below the LTP, isn’t it contradictory in nature. You want the price to decline so that you can buy it but once you buy, now the price trend should reverse so that you can be profitable.
  3. Do you set a target or once in profit, you keep trailing your stoploss until it hits.) Do you have a fix target(either price or time) in mind?
    4)How do you account for taxes,brokerage, bid-ask and slippage?
  4. After losing a trade, how does the size of the next trade change after a loss/win? Do you pyramid up while winning and vice-versa. Or is it constant.
  5. Do you prefer going with the trend and momentum or like being market neutral( i.e take both equal long and short position on different stocks)
  6. Another problem in scalping is of scaling up. It’s easier to make X to 5X with reasonable capital but far more difficult to make that 5X to 10X ( only doubling it instead of 5 times) using the same scalping tricks.
    8)What advice( preferably not a cliché)would you like to give to other retailers?
  7. Can you please mention any helpful articles, newsletter, links, Reddit/Quora questions, blogs, books or any other resources you have read which you liked.

P.S. - I don’t want to know your technical analysis based entry-exit strategies.

@nithin, You scalped in your trading days. How did you tackle these problems? Read you interview in Z-connect with @hanan

Lol, he is not interested in technicals and want to scalp

I have my own strategies for that and don’t want anybody to spoon-feed me. Thanks for your help though.

Scalping can really be done only in the most liquid contracts, so Nifty and Banknifty for us. Other than keeping the impact cost low, not having insiders against you helps by avoiding single stocks.

If you are manually scalping, it is mostly about trading using your gut, but ensuring you don’t break money management rules which is know the maximum loss on every trade (keep it under 0.5% of your trading account), don’t average down when in loss and if you are doing make sure to follow the 0.5% rule.
Pyramid up is okay.
Try as much as possible to not let your winning trade go into a loss, if it goes into a loss don’t try to make it back up in the next trade by increasing capital.
90% of trades do it with least possible size - 10% which feel more right increase the size.
The biggest problem with scalping is to scale up, once you are psychologically used to a size, you tend to panic faster when the size suddenly goes up. The best bet is to increase the size extremely slowly.

Let me dig into my resources and see if I can find threads/discussions on this from before.


Were you really a scalper in your trading days . I occasionally scalp but just to get lucky and have quick buck , at starting of trading days I used to do it more often but except for Hight frequency trading or arbitrage I found scalping as inconsistent in long run and many of times feels like tossing a coin . What are your views on this.